More than 250 Dutch and Indian businessmen and women attended the Netherlands Indian Business Meet (NIBM) in Amstelveen. Excellent and experienced speakers shared their experiences on how to close deals and make investments happen in India. Dutch seed company Incotec received the fourth NICCT India Business Award for its successful operations on the subcontinent.

 

Wake up

The opportunity for Dutch companies in India is clear. A huge market, a young population of over a billion, and a growing middle class. ING Bank expects the Indian economy to grow with 7,5% annually over the long term. The statistics are known, but how can businesses flourish in India? And how do foreign entrepreneurs close deals on the subcontinent? Vivek Chaand Sehgal, chairman of Samvardhana Motherson, a car parts maker, shared his experience with the audience during the seventh NIBM conference held at KPMG’s head office in Amstelveen. As an 18 year old Punjabi boy, Sehgal started a company with his mom, hence Motherson. Their budget: 8 euro. Now, Sehgals empire of joint ventures across the world is worth more than 3 billion euro’s. If someone knows how to do business in India it is the founder of Motherson. His message was, however, worrisome. “Europeans are too laidback. You sit on top of a mountain of ideas, on I.P. and talent, but you don’t do much with it. Since Europeans rebuild Europe after the second world war, your eagerness is gone. You have to wake up.”

 

Made for India

When European entrepreneurs have woken up, they have three strategies to enter the Indian market, sketched Kewal Shienmar, an Indian citizen who works for TomTom in Amsterdam. “If you don’t alter your product, the one-size-fits-all approach, you take a huge risk.” Shienmar advised to choose the ‘Made for India’ or the ‘Made in India’ strategy. TomTom chose the ‘Made for India’ strategy – it adapted its navigation system specifically for the Indian market. “At the park turn left, go right just before the temple and hit the gravel road on your left hand near the PizzaHut,’ is how Indians explain each other how to get from A to B,” Shienmar said. As a result his team came up with the revolutionary landmark navigation device. It launched last November and won a Device of the Year award and a Gadget of the Year award. “India is a good place to be for a technology company,” Shienmar concludes, “because India’s young population embraces technology fast.”

 

A deal is not a transaction, it’s a process

In a number of short presentations and panel discussions, it became clear that cultural differences are the main obstacle for closing deals. “The Dutch are often too eager to do business immediately. Your objective should be to get a second appointment, not to get any commitments,” advised Shienmar. David van de Weg, COO of Lemnis Lighting, a LED light producer that recently entered a joint venture with its long time Indian supplier NTL Electronics, warned that “the Dutch directness may come across as arrogance.” This, of course, harms the relationship, which is of utmost importance if you want to do business in India. According to Tjaco Walvis, managing partner of branding agency THEY, personal relations are even more important than signed contracts. “You don’t want to go to court in bureaucratic India, so you better make sure that your relationships are strong enough so that you can solve conflicts together.” That is also why the work does not stop when the deal is closed, explained Steven ten Napel, CEO of coMakeIT: “A deal in India is not a transaction. It’s a process.”

 

Focus, focus, focus

Real life obstacles to foreign investment exist too. Lalita de Goederen- van Lamsweerde, owner of the Bagel Café chain in Delhi mentioned that land, buildings, and attractive office and retail locations are extremely scarce and expensive in India. De Goederen currently has 4 outlets and she is opening a 5th one soon.  She initially planned to grow faster. “You cannot plan anything in India. You have to learn by doing.” Peter Ruigrok agreed. Ruigroks first attempt to establish his cold chain door production company Metaflex in India through a joint venture. He failed, but re-entered the market with a fully owned subsidiary company. “Focus, focus, focus,” was Ruigroks main message. “Focus on what your core competences are. Then decide what you will do yourself and what you will hire Indian employees for.” Both De Goederen-van Lamsweerde and Ruigrok highlighted that you have to love India to be successful there. “If you don’t love India, your business will fail.”

 

Long and painful

Even for Dutch seed company Incotec, the winner of this year’s NICCT India Business Award, the road to success in India was “long and painful”, admitted CEO Jan-Willem Breukink in his acceptance speech. “We have made a lot of mistakes.” Incotec has a 100% owned subsidiary based in Ahmedabad, Gujarat. Like all other speakers, Breukink highlighted that success depends heavily on finding good partners. “We took time to build excellent relations. You have to sweat for it. Now we reap the benefits.”